Offshore Retirement Plans and Offshore Pensions for Expats

Common characteristics

You can make contributions from anywhere in the world
Contributions are flexible – you can increase, decrease, stop and restart contributions to suit your personal circumstances
Premiums can generally be paid in Euros, Sterling, US Dollars, or Hong Kong Dollars
A savings term is established at the outset of between 5 – 25 years
The plan can be structured to take advantage of the favourable tax treatment offered to investors in certain tax jurisdictions
There is no tax relief on contributions as in many domestic pension schemes

Risks associated with offshore retirement plans

Offshore retirement plans are designed by international banks or insurance companies and tailored for the expat community.

You can make contributions from anywhere in the world
Contributions are flexible – you can increase, decrease, stop and restart contributions to suit your personal circumstances
Premiums can generally be paid in Euros, Sterling, US Dollars, or Hong Kong Dollars
A savings term is established at the outset of between 5 – 25 years
The plan can be structured to take advantage of the favourable tax treatment offered to investors in certain tax jurisdictions
There is no tax relief on contributions as in many domestic pension schemes

Transfer of existing retirement plans

For those seeking to retire abroad, it may be possible to take your domestic retirement plans with you. The UK in particular has established a new regime for overseas pension transfers to what are known as Qualifying Recognised Overseas Pension Schemes (QROPS). Such schemes have to be approved by home country governments in order to be recognized as acceptable transfer vehicles. For more information please watch our QROPS video

Factors to consider outside of the retirement plan

Before choosing your offshore retirement plan, there are some additional issues for considerations. These include:

Retirement Destination – If you intend to retire abroad, it helps if you understand/speak the local language, and are familiar with the customs, cost of living and political climate of the country in question
Timeline – Those that work overseas often enjoy a greater disposable income. This may enable them to save more and retire earlier. It is important to factor in the impact of inflation on your future standard of living. A useful international salary and inflation calculator can be found here
Future Expenses – How much will you need to save for your retirement? Major expenses such as children, home purchase, vacations and medical bills should be factored into your retirement strategy.
Inheritance – Have you written a ‘will’? Is it your intention to pass on assets to your family or loved ones?

Retirement planning for expats

AXIS Strategy Consultants offer pension planning services to expatriates with a view to helping them understand their retirement options. If you would like to find out more, please download our free guide on offshore pensions.

AXIS Financial
Consultants

is a team of international pension experts who assist clients in making the best financial decisions for their retirement.

Offshore Retirement Plans